Minimum wage

08 October 2019

The term ‘minimum wages’ refers to various regulatory restrictions of the lowest rate payable by employers to workers. Statutory minimum wages are regulated by formal laws or statutes. Collectively agreed minima are stipulated within collective agreements between trade unions and employers.

EU context

Most EU Member States have a statutory national minimum wage in place, although its level, adjustment mechanisms and coverage vary. Austria, Denmark, Finland, Italy and Sweden have minimum wages set within collective agreements, while Cyprus has statutory rates for different occupations.

The EU institutions jointly proclaimed the European Pillar of Social Rights in November 2017, setting out the EU’s commitment to fair wages for workers. This includes ensuring adequate minimum wages for workers to allow them to have a decent standard of living, safeguarding the ability of the low-skilled and young workers to find employment, while also making work financially attractive.

Research

Eurofound provides regular updates on pay in the EU, including minimum wages in the Member States.

Key outputs

Eurofound's annual review of minimum wages for 2019 covers developments in minimum wages in the EU and Norway. It looks at minimum wage levels, how they are set and how they have developed over time in nominal and real terms. 

In a study on pay in Europe in the 21st century, Eurofound explored the implications of a hypothetical scenario of a minimum wage coordinated at EU level and set at 60% of the median national wage.

Featured: Minimum wages in Europe in 2019

4 June - This report present figures on real minimum wage rates and offers, for the first time, some insights into the net remuneration of those receiving the minimum wage. The report also contains information on minimum rates from selected collective agreements in countries without statutory minimum wages and minimum wage coverage rates of workers by gender. It shows that minimum wages are on the rise across the EU, but that women are overrepresented among minimum and low-wage earners.
Minimum wages in 2019 – Annual review

Key messages

  • Minimum wage workers in almost all EU countries saw an increase in their pay in 2019. Some of the highest increases in nominal terms were recorded in Spain (22%) and Greece (10%).
  • The increase in the minimum wage in Greece was the first in seven years and, for the first time, the government has implemented a centralised mechanism to set the new rates.
  • Italy and Cyprus are currently considering the introduction of a statutory minimum wage, with much political debate around the issue on a national level. 
  • Transparency and predictability is an ongoing issue: just seven Member States specify relative targets for minimum wages and how they should grow and only four Member States have made these upwards targets. 
  • Sudden and high increases of minimum wages may be popular, but can pose risks to employment and compliance: for this reason, involving the social partners in the process of setting up mechanisms and adapting minimum wage rates is important. 
  • Setting a minimum wage rate and understanding possible implications of changes to the rate is a complex process. It is vital to base these decisions on evidence and best practice.
  • The 2019 report shows that women are overrepresented among minimum wage earners in nearly all Member States, irrespective of how minimum wage earners are defined.
  • An important question for policymakers is whether introducing or increasing minimum wage rates can help to narrow the gender pay gap, as changes to minimum wages can have broader implications for lower-wage earners that could mitigate the desired impact.

Data and resources

Ongoing work

  • Highlights of recent developments of selected features of working life in so called topical updates, with one featuring statutory minimum wages

 

Highlights (8)

Tümü (131)

Publications (22)

Articles (102)

News (6)

Events (1)